The popular stablecoin issuer Tether has mistakenly issued and consequently burned $5 billion worth of USDT. The move was immediately noticed by the crypto community, and the CTO of Bitfinex, Paolo Ardoino, has already given a statement on the matter. However, the price of Bitcoin immediately reacted, shedding about 3.5%. At the time of this writing, it continues to depreciate.
Tether Prints and Burns $5 Billion USDT
Popular and controversial stablecoin issuer Tether has managed to attract the spotlight once again. Yesterday, the company mistakenly minted and then subsequently destroyed a massive amount of USDT totaling $5 billion.
The initial issuance was caught by the Whale Alert bot on Twitter and immediately caused a wave of euphoria within the community.
Soon afterward, however, Paolo Ardoino, the CTO at Tether-associated cryptocurrency exchange Bitfinex, provided an explanation.
While preparing the issuance for Omni to Tron swap there have been an issue with the token decimals. Please check the burn transactions below @Tether_tohttps://t.co/reEW51qCqihttps://t.co/zo5i3ayTuQ https://t.co/h1Y9Mnr4Oq
— Paolo Ardoino (@paoloardoino) July 13, 2019
Apparently, by now, all of the newly issued USDT has already been burned. The move was confirmed by another cryptocurrency exchange, Poloniex, which reaffirmed that it was conducting a USDT chain-swap with the assistance of Tether.
It’s important to understand that the Tethers in question weren’t issued on the more commonly used networks, but rather on that of Tron.
Bitcoin’s Price Reacts
Tether has long been suspected of engaging in price manipulation. The company does have a somewhat scandalous past in this regard.
It appears that the minting of fresh USDT, especially in such large amounts, is considered by the community as a sign that the price of Bitcoin will soon take off in a certain direction.
Even though the $5B USDT supposedly never hit the market, the news of the huge amount of money being printed did have an impact on Bitcoin’s price.
Almost immediately after the transaction was first caught, Bitcoin declined by about 3.5%, falling below $11,000. The price went on to increase but has since declined further, and is currently trading at around $10,700 which marks a drop of about 4.5%.
The entire market has taken a downturn, with large-cap altcoins suffering as well. Among the top 10 currencies by market cap, Ethereum seems to be the biggest loser, having declined by about 11% at the time of this writing.